Fraud Risk Scheme:
Insider fraud occurs when an employee (or ex-employee), who has legitimate access to the company's systems, data, or assets, uses this access for personal malicious purposes. An insider can abuse their position to steal customer data, embezzle funds via fake invoices or false supplier accounts, or modify systems to hide unauthorized transactions. Detection is often difficult because the employee knows the weaknesses and the internal control processes.
Detection:
Operations outside working hours: Monitoring any connection or transaction initiated by an employee late at night, very early in the morning, on weekends, or during holidays, particularly on sensitive systems.
Transactions just below validation thresholds: Identifying transfers, refunds, or other operations where the amount is intentionally kept just under the limit that would trigger a verification or additional approval by a superior.
Access to data and systems not necessary for the position: Detecting queries or consultations by an employee on customer files, financial information, or network areas that do not correspond to their usual responsibilities.
Prevention:
Strict access controls (Principle of "need to know"): Limiting each employee's access only to the systems, data, and privileges that are absolutely essential for the execution of their tasks (principle of least privilege).
Rotation of sensitive positions and mandatory leave: Periodically changing employees in critical functions or obliging them to take their leave to allow a replacement to verify operations and detect potential hidden irregularities.
Segregation of Duties (SoD): Ensuring that no single person controls the entirety of a transaction, from initiation to payment (for example, the person who approves an invoice should not be the one who executes the payment).
Share your feedback:
What tools, techniques, and processes are used in your organization to detect and prevent such fraud schemes?
